The recent surge in global oil prices has triggered concerns over an impending rise in the cost of refined petroleum products in Nigeria.
Brent crude, the global benchmark for crude oil pricing, climbed to $79.76 per barrel on Sunday from the $72.88 recorded in December 2024.
This upward trend caused by additional sanctions imposed on Russian oil exports and seasonal demand fluctuations in colder regions is expected to impact fuel prices across Nigerian depots.
Crude oil key determinant in the pricing of refined petroleum products and the correlation between the two is well established.
Sources revealed that diesel prices began to rise on Friday at several fuel depots, signaling a broader increase in refined product costs.
For instance, the Nipco depot in Lagos recorded a price increase of ₦70 from ₦1,050 to ₦1,120 per litre while the Prudent depot saw diesel prices rise to ₦1,045 per litre from ₦1,025 earlier in the week.
An oil and gas expert, Olatide Jeremiah, explained that the rising Brent crude price is a key driver of these increases.
“It implies that there is a possibility of increased fuel prices, particularly diesel prices. As of Friday, when Brent crude neared $80, prices selectively increased in some depots in Lagos, and on Monday, prices might be jacked up by importers because a large chunk of oil marketers import petroleum products and Brent crude is a major determining factor in the refining process,” said Jeremiah, who is the Chief Executive Officer of Petroleum Price.
The Federal Government’s oil price benchmark in the 2025 budget is set at $75 per barrel. However, the recent surge in Brent crude prices raises concerns about the impact on fuel importation costs and domestic pricing structures.
Analysts suggest that the higher crude prices will likely lead importers to adjust their prices to cover increased procurement and shipping costs.
Industry stakeholders warn that the effects of the rising crude oil prices will ripple through the economy, potentially exacerbating inflationary pressures and increasing operational costs for businesses dependent on refined petroleum products.
As the global oil market remains volatile, fuel consumers in Nigeria are bracing for potential price adjustments in the coming days.
